RISE summarizes recent regulatory-related headlines.
Judge rules Humana’s MA clawback lawsuit can move forward
A federal judge has ruled that Humana’s lawsuit over the Centers for Medicare & Medicaid Services’ (CMS) plan to audit Medicare Advantage payments can move forward.
Judge Reed O'Connor of the U.S. District Court in the Northern District of Texas has denied a motion by the Department of Health & Human Services (HHS) to dismiss the case.
Humana filed the lawsuit in September 2023 over a CMS final rule that made significant changes to risk adjustment data validation audits (RADV), which is the agency’s primary audit and oversight tool for Medicare Advantage program payments. The suit aims to block the agency from using its new methodology to recover payments CMS has made to Humana since 2018. The insurer claims the final rule is “arbitrary and capricious” because it reverses CMS’ prior policy on the FFS Adjuster without an adequate explanation. It also claims CMS abused its discretion in deciding to apply the new policy retroactively beginning in payment year 2018 because it relied solely on legal justifications that misinterpret the Medicare Statute.
Humana argues that the final rule will lead to it facing financial loss in compliance costs caused by the necessary changes to its annual bid submissions to CMS. It will also face financial losses from pending and future RADV audits using the new methodology.
CMS estimates it could recover $4.7 billion in overpayments to MA plans through 2032 using the new audit methodology.
In the order, O’Connor wrote that Humana’s “compliance costs constitute a substantial hardship, and, with the issues fir for review, the case is ripe.” He denied HHS’ motion to dismiss the case for lack of standing.
Senators reintroduce bipartisan ‘must-pass’ prior authorization reform bill
A group of Republican and Democratic senators this week reintroduced bipartisan, bicameral legislation to streamline the Medicare Advantage prior authorization process. The bill, “Improving Seniors’ Timely Access to Care Act,” would establish an electronic prior authorization process; increase transparency around prior authorization; clarify CMS’ authority to establish for e-prior authorization requests, including expedited determinations; expand beneficiary protections; and require HHS and other agencies to report to Congress on program integrity efforts.
The bill unanimously passed the House of Representatives in 2022 and was cosponsored by a majority of members in the Senate and House of Representatives. However, it stumbled after the Congressional Budget Office estimated the legislation would cost $16 billion over 10 years.
“Prior authorization is the number one administrative burden facing physicians today across all specialties," said U.S. Senator Roger Marshall, M.D. (R-KS), the lead sponsor of the bill, in an announcement. “As a physician, I understand the frustration this arbitrary process is causing health care practices across the country and the headaches it creates for our nurses. With the bipartisan, bicameral, Improving Seniors’ Timely Access to Care Act, we will streamline prior authorization and help improve patient outcomes and access to quality care and life-saving medicine. With the improvements we’ve made there is no reason we should not quickly get this bill signed into law.”
Supreme Court unanimously preserves access to mifepristone
In a unanimous opinion written by Justice Brett Kavanaugh, the Supreme Court ruled a group of anti-abortion doctors did not have the legal standing to challenge the Food and Drug Administration’s (FDA) approval of the abortion pill mifepristone and increased access to the drug. Mifepristone has been used for more than 20 years since the FDA approved it. Despite the ruling, HHS Secretary Xavier Becerra warned that “women’s health remains under attack” since the Supreme Court overturned Roe v. Wade in 2022.
“Every day, women in states across America are forced to live with the devastating consequences of these attacks on reproductive rights. Health care decisions should be made by women in consultation with their doctors—not politicians. At HHS, we will continue take action to strengthen and expand access to health care, protect privacy protections, and preserve individual rights. We will continue the fight to restore Roe v. Wade and defend reproductive rights for all Americans.”
CMS report projects national health spending trends through 2032
A new report by CMS’ Office of the Actuary predicts the average annual growth of national health spending will outpace average annual growth in gross domestic product over 2023-2032. This will result in an increase in health spending share of the gross domestic product from 17.3 percent in 2022 to 19.7 percent in 2032.
The increase is due to expected effects from provisions within the Inflation Reduction Act of 2022, including the redesign of Medicare’s Part D drug benefit, negotiations on certain high-cost drugs under Medicare Parts B and D, and expected enrollment and spending trends related to its temporary extension of enhanced subsidies for Marketplace plans.
Pharmacy owner sentenced in $1M health care fraud case
A California man who co-owned a pharmacy has been sentenced to two years in prison for submitting more than $1 million in false and fraudulent claims to Medicare for prescription drugs that were never dispensed to beneficiaries.
Paul Mansour, 56, of Sierra Madre, a pharmacist who co-owned Mansour Partners Inc., doing business as Best Buy Drugs (Best Buy, created fake patient profiles in the pharmacy’s digital filing system using fictitious names, dates of birth, and addresses. He added fraudulent prescriptions to the fake patient profiles and then submitted false and fraudulent claims to Medicare for those prescriptions in the name of actual Best Buy patients. In doing so, Mansour billed Medicare for fraudulent prescriptions that were never dispensed to beneficiaries. He pleaded guilty in April 2023 to one count of health care fraud.